KT to reduct workforce by 25%

KT said Monday that it will cut its total workforce by up to 25 percent.

The massive lay-offs are expected to save at least 700 billion won in annual expenses.

“A total of 8,320 KT employees applied for the voluntary retirement program. We will terminate contracts with those employees before April 30,” said KT in a statement.

The plan will reduce the firm’s total payroll to 23,868 from 32,188.

This is the biggest restructuring in the firm’s history, and is the second downsizing effort since 2009 when the nation’s dominant fixed-line operator laid off 6,000 in the wake of the merger of KT and KTF.

Spokeswoman Juliana Kim said the company will provide financial compensation based on working period, seniority and performance.

“The growing expenditure on wages has always been one of the biggest burdens deteriorating KT’s profit structure,” said the spokeswoman.

“Follow-up measures will be coming soon. Unprofitable business units will be restructured,“ she added.

Of the total applicants for retirement, people aged 50 or older accounted for 69 percent, followed by those in their 40s at 31 percent.

The firm received applications from employees who have worked for it for over 15 years from April 10.

“If outgoing workers want, KT will send them to one of our affiliates with a two-year contract. Also, we will run programs to help them find new jobs,” the company said in the statement.

The spokeswoman said that the restructuring will have a limited impact on the company.

KT recently raised $1 billion through a bond sale to overseas investors to repay debts and secure one-time spending for compensation for the outgoing employees.

This is the latest effort by KT CEO Hwang Chang-gyu to downsize the organization and improve its productivity.

Since Hwang took office in January, KT has shifted into “emergency mode” as it has been reeling from a decrease in profit due to expanding non-core businesses and losing share in the fixed-line segment.

He earlier cut the number of executives and merged unprofitable departments. Hwang also plans to drop some overseas business projects to improve competiveness in its core telecommunications business, said KT officials.

KT has been consistent in cutting the number of employees. In order to ensure productivity and efficiency, the company laid off 5,134 in 1998, 3,762 in 1999, 1,161 in 2000 and 5,505 in 2003. By Kim Yoo-chul The korea times займ на карту без отказов круглосуточно